Human Rights Groups immediately welcomed the acquittal but said the case should never have been brought in the first place.

Australian Alan Morison and Thai Chutima Sidasathian were facing up to seven years in prison over a report in their online news website Phuketwan saying military forces accepted money to assist or turn a blind eye to the trafficking of refugees from Burma by sea.

They were charged with criminal defamation and offences under the draconian Computer Crimes Act.

"This is a fantastic day for us, to be free of the weight of this charge," Mr Morison said outside the court, on the island of Phuket. "I think it's an important result for Thai media and for the media in general."

The contested report on the Phuketwan website was excerpted from an extensive story published by the Reuters news agency in July 2013.

The Reuters story was part of a series that won the news agency the 2014 Pulitzer Prize for international reporting.

The case had drawn widespread criticism from human rights and press freedom groups around the world.

"The acquittal of these two journalists is a positive decision, but the fact is that they should never have had to stand trial in the first place," said Josef Benedict, the regional representative for Amnesty International. "Thai authorities have again shown their disregard for freedom of expression by pursuing this case."

The case came to trial following the discovery in May of dozens of bodies buried at several jungle camps on the Thai-Malaysian border where traffickers held migrants as prisoners.

Many of the migrants are ethnic Rohingya from Burma who face persecution at home. In many cases, the migrants pay to be smuggled by ship, but are then detained by traffickers in Thailand who hold them until their families pay ransoms.

Human rights activists and foreign governments have long accused Thai authorities of collusion in the trafficking industry, but police, military and government officials deny the allegations.

But the recent publicity about the camps prompted a Thai government crackdown on trafficking, and several dozen people were arrested, including a Thai army general and local officials.

The US State Department in July said it was keeping Thailand on its human trafficking blacklist and retained Thailand's Tier 3 ranking, the lowest ranking in its annual Trafficking in Persons report.

The ranking designates Thailand as a country that has not made sufficient progress in tackling human trafficking.

It cited persistent forced labour and sex trafficking and recommended that Thailand stop bringing criminal defamation cases against researchers or journalists who report on human trafficking.